high-speed rail’s risky financing

State auditor’s report latest in a series of critical reviews questioning bullet train

Sacramento 
The proposal to build a $98 billion high-speed rail system linking California relies on risky financial assumptions and its planners have secured just a fraction of the billions they’ll need to complete the project, raising further questions about the rail plan that has come under mounting criticism, the state auditor said in a report released Tuesday.

The unfavorable review by state Auditor Elaine Howle was the latest in a series of critical reports that have questioned the financing, proposed route and shaky ridership projections for the 220 mph bullet train voters approved in 2008. That has caused lawmakers from both parties who once supported the project to have second thoughts.

While construction costs for the line linking the Anaheim-Los Angeles area to the San Francisco Bay could range from $98.5 billion to $117 billion, the latest plan from the California High-Speed Rail Authority identifies just $12.5 billion in promised funding — about $3.5 billion in federal stimulus money and $9 billion in voter-approved bonds.

Howle’s audit notes the proposal, released in November, relies upon the federal government as by far the largest source of financing yet “provides few details indicating how the authority expects to secure this money.” It also does not offer viable alternatives if that funding is unavailable, the report said.

A response from then-board Chairman Thomas Umberg included in the audit said the comments the auditor relied upon to conclude the funding is risky “are purely speculative and should not form part of an audit response.”

Gov. Jerry Brown has continued to back the project despite the critical review.